Saturday, August 1, 2009

OROP latest by Lt Gen Raj Kadyan

Dear Colleagues,

The 21-page report of the Cabinet Secretary’s Committee is available with me. I am giving below a summary of some of the relevant points. To achieve brevity I have used my own language. While the committee uses recommendatory language, in the gist below it may sound directional.

Committee of Secretaries Headed by Cabinet Secretary: Gist of recommendations
In turning down OROP the Committee has relied on earlier committee and GOM reports, SC judgement on ESL petition filed as a sequel to the decision in DS Nakara & Ors Vs Union of India, and advice of the Ministry of Law.

The Committee also interacted with various ESM Associations, namely, the IESL and the Air Force Association to seek their views. The Associations gave the following major options in regard to OROP:
Option 1 Calculation of the pension of pre-1.1.2006 retirees by reckoning the highest of the pay in the pay band for each rank and thereafter application of weightage to this figure.
Option 2 Calculation of the pension of pre-1.1.2006 retirees by taking the mid-point between the minimum fitment of each rank in the revised pay band and maximum of the pay band and thereafter applying the weightage.
Option 3 Calculation of the pension of pre- 1.1.2006 retirees with reference to the notional maximum in the post- 1.1.2006 pay scales. Thereafter the weightage may be applied.
Options 1&2 were found not feasible as even the pension of post 1.1.2006 retirees is not calculated on this basis. “However, the option 3 is similar to the benefit granted in 2006 based on the recommendations of the GOM.”

Summary of Recommendations
(1)Bring pre-10.10.1997 PBOR pensioners on par with post 10.10.1997 PBOR pensioners. (financial implication – 470.66 Crore per annum)
(2)Accept enhancement of classification allowance wef 1.1.2006 on notional basis (as in case MSP). This would benefit around 88000 PBOR. (Financial implication – 7.73 Crore per annum). To be implemented wef 1.1.2006 and pay arrears.
(3) Notional, weightage sans Arrears:
(a) Reckon pension of all pre 1.1.2006 PBOR pensioners with reference to a notional maximum in the post 1.1.2006 revised pay structure corresponding to the maximum of pre-Sixth Pay Commission pay scales as per fitment table of each rank.
(b) Also to continue with the enhanced weightage awarded by the GOM.
This will result in average monthly increase in the pension of pre 1.1.2006 PBOR in the range of Rs 800 to Rs 1400 for Gp Y depending on rank and years of service. Will benefit 12 lakh pre 1.1.2006 PBOR pensioners, (financial implication – 1636 Crore per annum). Being a new concession applies prospectively. No arrears.
Commissioned Officers
(4) Remove linkage of full pension with 33 years of qualifying service wef 1.1.2006 instead of 1.9.2008. Will benefit around 1100 officers (Army) whose pension would increase by about Rs 3000 pm (financial implication – 4.83 Crore per annum). Proposal emanates from Sixth PC; implement from 1.1.2006 and pay arrears.
(5) A separate pay scale starting at 67000 and going up to 79000 be created and all offrs at the level of Lt Gen/Addl Secy/equivalent be fixed in this scale. As a result, pension of pre-1.1.2006 Lt Gens will get fixed at 36500.00 and those of Addl Secys at 33500.00. Will benefit roughly 4000 offrs. (Financial implication – 25 Crore per annum). Proposal emanates from Sixth PC; implement from 1.1.2006 and pay arrears. The Committee has justified the increase for Lt Gens by stating that after the Sixth PC recommendations, the pensions of pre-1.1.2006 Brigs, Colonels and Lt Cols have greatly improved and in percentage terms there is very little difference the pension of pre-1.1.2006 and that with ref to minimum of fitment tables. The difference is around 2% at the level of Lt Col, 6% at the level of Colonel, 11% at the level of Brigadier, 13% at the level of Maj Gen. Only at the level of Lt Gen is there a difference of about 26%.

THE OROP has been denied. ESM may comment on the report of the Committee in whatever manner or at whatever forum. However, kindly do not seek clarification/ justification from me, for I have only summarised facts. We need to take a call on our next course of action. And soon.
Best regards,
Lt Gen (Emeritus) Raj Kadyan, PVSM, AVSM, VSM
Chairman IESM